Which TSX stocks to buy amid rising fears of omicron XE variant?

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Which TSX stocks to buy amid rising fears of omicron XE variant?

Which TSX stocks to buy amid rising fears of omicron XE variant?
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Highlights

  • As the fear of COVID-19 returns in the form of a new variant, some Canadians are looking for quality TSX stocks.
  • This new COVID sub-variant was first identified in the United Kingdom.
  • Some experts believe that this strain could be less severe as it has a greater transmissibility rate.

As the fear of COVID-19 returns in the form of a new variant, some Canadians are looking for quality TSX stocks to minimize protect their portfolios to some extent. Some such stocks can be those of the big six banks in Canada, which are generally known for their stable returns.

Japan reported its first omicron XE variant case on Tuesday, April 12. This new COVID sub-variant was first identified in the United Kingdom. The UK Health Security Agency (UKHSA) said that XE cases have almost doubled in Britain, based on its latest statistical data, and have a growth rate of 9.8 per cent more than that of the BA.2 variant.

Some experts believe that this strain could be less severe as it has a greater transmissibility rate.

Now, let us discuss the two TSX bank stocks amid rising XE cases worldwide: Bank of Nova Scotia (TSX: BNS) and Bank of Montreal (TSX: BMO).

Bank of Nova Scotia (TSX: BNS)

Scotiabank was recognized as the Financial Issuer of the Year by Refinitiv publication International Financial Review (IFR) in February 2022 for its funding strategy and capital innovation.

The bank posted net profit of C$ 2.74 billion and diluted earnings per share (EPS) of C$ 2.14 in Q1 FY2022. It will dole out a quarterly dividend of C$ 1 on April 27.

BNS stock saw a price surge of about 11 per cent year-over-year (YoY).

 Bank of Nova Scotia (TSX:BNS)’s Q1 2022 results

Also read: 5 Canadian bluechip stocks to buy in 2022

Bank of Montreal (TSX: BMO)

Bank of Montreal noted a 45 per cent YoY rise to C$ 2.93 billion in its net profit with an EPS of C$ 4.43 per share in Q1 2022.

BMO will pay a quarterly dividend of C$ 1.33 apiece on May 26.

BMO stock swelled by nearly 26 per cent in the last 12 months.

Bottomline

The bank stocks mentioned above are blue-chip stocks with large market capitalization and could provide stability during economic and COVID challenges. However, investors should do thorough research and invest according to their risk-reward targets.

Also read: GPV and VMC: 2 TSXV EV stocks to see as Canada invests in Honda plant

Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.

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